Quick Takes From Ventana Research

Ventana Research is the pre-eminent research and advisory services firm in the Business Performance Management market. With the unique research framework covering both the technology and business aspects of performance management, Ventana Research helps decision-makers throughout the organization understand each other's requirements, align goals and objectives, and optimize business processes with existing and new technology investments.

Ventana Research covers the business processes of customer relationships, supply chain, financials, operations, and workforce performance management. The technology coverage covers applications, tools, platforms and technologies from existing technology markets including analytics, business intelligence, business process management, data warehousing, enterprise applications, enterprise portals, and knowledge management.

For more information, visit our Web site at www.ventanaresearch.com

 Performance Scorecards Ignore Supply Chain
Research shows corporate scorecards deployed only to Finance and Sales
Colin Snow, July 25, 2006
One of the major tenets of performance management is to link strategy with corporate goals and objectives in ways that make the best use of the company's resources by coordinating the efforts of every member of the organization. But a recent study by Ventana Research on the use of performance management technology finds that not every member of the organization is being included. In particular, the study shows that current deployments of scorecards are narrowly focused. The largest numbers of users are in Finance (46 percent) and Sales (41 percent), while the smallest numbers are in supply chain operations (18 percent) and customer service operations (13 percent). The specific supply chain operations not being served by scorecards include product design, planning, sourcing and procurement, manufacturing, fulfillment, distribution and delivery, and returns. Ventana Research believes the frequency of deployments into the finance and sales functions confirms that companies value tracking revenue goals over tracking balanced measures of executing operational strategy; we believe this needs to change if organizations want to manage the performance of their operational assets.

Related Research Notes:
Supply Chain Improvement: Take It from the Top
Operational initiatives start with top-level performance scorecards

 Oracle to Acquire Demantra
Latest takeover points to market consolidation and uncertainty for customers
Colin Snow, June 20, 2006
Oracle will expand its supply chain management (SCM) application offerings with the acquisition of Demantra, a provider of demand planning software. Demantra offers analytics- and collaboration-based products for demand management, sales and operations planning and trade promotion planning and optimization. Oracle says Demantra's products complement its own and will further enable customer companies to move from a push-driven supply chain to a demand-driven supply chain. The benefit for customers, as Oracle sees it, is customers will be getting access to demand and supply chain capabilities that is combined with its enterprise resource planning (ERP) applications and technology infrastructure.

Ventana Research sees this acquisition confirming two of our observations about the market. The first is that while Oracle recognizes the need for vertical specialization in its product offerings - in this case, consumer packaged goods - it lacks the ability to execute timely improvements to its own SCM products and those it acquired from the PeopleSoft/JD Edwards acquisition. The losers here, of course, are current users of the various systems who want a straight upgrade path but instead must follow a wandering leader. The second observation is that the SCM software market will continue to consolidate. Stand-alone companies like Demantra have been less profitable than they needed to be and lacked large enough customer bases to support long-term software development. The continuing consolidation trend will be important in the coming decade because major shifts that will occur in software architecture will create a need to rewrite all of these applications. We expect the consolidation eventually will leave i2 Technologies, Infor/SSA, Oracle and SAP as the major SCM players.

Ventana Research recommends that organizations wait on any further purchases or upgrades of Demantra applications until Oracle announces whether it will plug this acquired technology into Fusion or will maintain and improve it in standalone form.

Related Research Notes:
Further ERP Consolidation Occurs
Private equity group continues to collect fragmented software assets

 BI Is Not Middleware
Oracle indecisive on whether BI will be separate or integrated into Fusion
Mark Smith, April 18, 2006
Oracle's recent acquisition of Siebel and its Business Analytics product line has raised the question of whether, in product packaging and positioning terms, business intelligence (BI) should be separate from middleware. Oracle has historically made its BI part of the middleware product line, now called Fusion. But IT and business executives through their purchasing power and the strategic priorities they've set have made BI a specific technology segment that is used for strategic business purposes. Middleware on the other hand increasingly is being viewed in the same light as the application servers and integration technologies that IT uses to build and integrate applications.

We think it's reasonable for organizations to expect from their technology supplier a commitment to BI in the form of a dedicated marketing, sales, services and product organization; otherwise, they may see their interests pushed aside by technology advances and capabilities oriented to developers and not business users. Ventana Research believes that BI is a distinct, and indeed a critical, information technology required to support organizations in their performance management processes.

 RiverOne May Put i2 Back in the Game
Addition of the partner relationship tool has promise for supply chain performance management
Colin Snow, February 21, 2006
On Feb. 21, 2006 i2 Technologies announced the purchase of the assets of RiverOne, Inc. The acquisition gives i2 access to a multi-enterprise execution platform that would extend its supply chain collaboration and execution capabilities. RiverOne's software is designed as a single, multi-company business application that enables complex, multi-tiered planning and process execution, with monitoring, between trading partners. It has helped companies like Solectron and ViaSat manage and control partner-based business operations. RiverOne's customers are mainly focused in electronics and range across all supply chain roles and sizes from small subsystem OEMs to the largest EMS providers.

The acquisition could be a strategic addition for i2 if it decides to leverage the RiverOne assets by integrating the partner relationship application with i2's current offerings. Ventana Research believes this is an important step for i2 in that it could allow it to deliver significantly improved supply chain performance management capability to those manufacturing and supply chain customers that have peaked in their ability to extract value from their current applications. Ventana Research believes that global organizations should be looking to applications like RiverOne's Multi-Tier Planning tool to establish shared processes, metrics and data among trading partners. If it becomes an i2 offering, its broader availability could improve the capability of these large organizations to plan, execute and manage the performance of supply chain programs program-by-program and partner-by-partner.

 Rapid Deployment Complements RapidResponse
Kinaxis' New Deployment Services to Accelerate Customer Benefit
Colin Snow, July 29, 2005
In May 2005, Kinaxis, formerly Webplan, capped a year of more than 80 percent customer growth and more than 200 percent growth in software licensing revenue with a name change and the launch of a new set of deployment services designed to accelerate implementation of the company's RapidResponse supply chain management solution. Ventana Research believes Kinaxis' growth stems from rising adoption of Performance Management best practices by companies looking to improve supply chain and manufacturing effectiveness.

More and more manufacturers and distributors are realizing that their demand, supply, capacity and product balancing decisions may engender unintended consequences. Operational success increasingly is defined by how fast an organization can respond to volatile customer demands and global supply conditions. Many manufacturers, especially in the electronics sector, don't know exactly what to execute until the start of each day, so success is contingent on effective decision-making. Supply Chain Performance Management solutions like RapidResponse minimize such problems by scoring plans and providing alternate scenarios within the context of an organization's overall performance improvement objectives. Ventana Research believes organizations looking for technology to support Operational Performance Management should evaluate currently available offerings, including those from Kinaxis. These offer a path to an integrated solution and provide a key building block for overall Performance Management.

 SAP Purchase of Lighthammer Likely to Deliver Performance Solutions
Acquisition Targets SAP's 12,000 Manufacturing Customers
Colin Snow, July 14, 2005
On June 22, 2005, SAP announced the purchase of Lighthammer Software Development Corporation. The acquisition extends SAP's strategy of enabling adaptive business networks, or ABNs. Lighthammer's Service oriented Architecture (SOA) undoes the disconnect between the shop floor and the balance of the enterprise, providing manufacturing performance management & execution. The Lighthammer products provide real-time visibility of manufacturing exceptions and performance variances, including data about causal factors and business impacts, enabling manufacturers to respond rapidly to unforeseen events. The SAP-Lighthammer combination provides the vehicle to deliver real-time transactional integration between ERP and plant floor systems as well as to provide to managers needed performance analytics, visualization and workflow. This acquisition is an important step in improving the management of manufacturing across multiple plants and operations in that it unifies all systems and standardizes all KPIs. Ventana Research believes this is an important step for SAP in providing significantly improved operational performance management capabilities to its manufacturing and supply chain customers. Because of their complexity and cost, these sorts of solutions have been neglected in organizations' overall performance improvement initiatives. Ventana Research believes organizations looking for multi-plant or multi-operation monitoring and management solutions should evaluate this offering. It offers a flexible path to an integrated solution and provides a tool that will help companies understand, align and improve the efficiency of their manufacturing operations.

 Gordon Foods Perfects Budgeting & Planning
Gaining User Adoption and Elevating Budgeting for the Enterprise
Mark Smith, June 2, 2005
For most organizations, budgeting and planning are still slowly evolving financial processes that are not well automated and often do not yield effective financial and operational results. Gordon Foods decided to transform their budgeting and financial reporting processes for finance and operational planning improvement. The company transformed its processes and leveraged Geac MPC to provide employee level salary and expense budgeting across 5,000 employees along with capital planning for executive management. Leveraging non financial data and actual vs. budget information Gordon Foods have deployed MPC to over 600 users for providing financial budgeting and reporting. Other organizations that want to integrate budgeting into the Performance Management processes should review best practices and evaluate well integrated systems that can support more efficient and effective budgeting and financial reporting. Ventana Research sees Gordon Foods as a classic example of an organization which has evolved its financial processes to support corporate goals for reaching maximum business performance by way of a finance and IT link.

 Workstream Changes the Market Equation
New One Dollar per Employee Model will Change the Workstream Market Forever
Mark Smith, April, 2005
Workstream has announced a new simplified pricing model to drive massive adoption of their enterprise workforce management suite. This solution is available in a hosted and rental software as a service model. In a move that massively undercuts the traditional HRMS and ERP providers like Oracle and SAP. Workstream is offering its entire suite at one US dollar per employee, per month when ordered in quantity. For companies with thousands of employees, this price could save organizations millions of dollars annually compared to purchasing software and paying maintenance and consulting services for customization. Ventana Research believes that this dramatically reduced pricing model will make it so simple to adopt and rapidly deploy workforce management that organizations will quickly move beyond their existing HRMS providers to save money and mitigate risk.

 JetReports Simplifies Financial Reporting for Small Business
Simplified Excel Based Reports for SMB Organizations Using Great Plains and Navision
Mark Smith, April, 2005
Reporting continues to be a challenge for organizations of all sizes. JetReports offers a new option for those organizations using Microsoft Great Plains and Navision financial applications utilizing Microsoft Excel based reports. Recently at Microsoft Business Solutions (MBS) Convergence user conference, JetReports was demonnstrating their latest release and customer momentum. Ventana Research continues to see a large demand from MBS users for simplified reporting and BI. We advise organizations to examine simple and low cost options like JetReports that can enhance the value of your existing MBS investments.